Bishop / Martin: Legislative action on the economy | Perspective
At the start of the pandemic last year, it became clear that in addition to the significant challenges posed, there were new opportunities to reassess Vermont’s needs and invest in our future. The Vermont Chamber has identified specific critical needs for Vermonters working in child care, broadband, and housing. During the last legislative session, we saw substantial investments in these areas through a child care bill, $ 150 million allocated for broadband expansion and $ 190 million. dollars allocated to housing.
However, when it came to providing immediate support to recovering businesses, the Legislature did not help significantly. Only $ 30 million in relief grants has been allocated to Vermont businesses. It’s not enough. In December, the Trade and Community Development Agency estimated employers’ known unmet need at $ 500 million. The Legislature also advanced a $ 100 million tax on employers to fund increased Unemployment Insurance (UI) benefits. This new tax goes against the efforts of companies struggling to recover from the pandemic and rehire staff.
Lawmakers are to be commended for supporting several Vermont Chamber priorities that have crossed the finish line and will help businesses recover from the pandemic:
– Prevent the taxation of PPP loans
At the insistence of the Vermont chamber, the legislature agreed to exclude 2021 Paycheck Protection Program (P3) beneficiaries from tax liability. The Vermont Chamber and other business organizations have repeatedly advocated to prevent lawmakers from taxing 2021 PPP loans. Companies affected by the pandemic and having accessed PPPs will now avoid a significant tax burden.
– Reduced UI rate increase
We pushed the Legislature to prevent significant UI premium rate hikes for employers forced to fire employees due to COVID-19. We also helped get changes to remove 2020, an abnormal year, from the review when the Department of Labor calculates UI tax rate schedules. Unemployment insurance tax rates rise when employers fire workers, penalizing them for doing so. However, the pandemic layoffs were due to government restrictions, forcing this recalibration of the formula.
– The new Montreal office will strengthen Vermont’s ties with Canada.
A new business attraction investment program will generate foreign direct investment (FDI) prospects for Vermont in aerospace, biotechnology and renewable energy and provide Vermont with nationwide representation. State in Quebec. The initiative will increase FDI with Canada and promote cross-border trade and tourism when the border reopens. We helped secure funds for this initiative to strengthen our ties with Quebec, promote post-pandemic tourism, and attract Canadian businesses interested in establishing a footprint in Vermont for contract opportunities.
– Incentives to attract remote workers will continue.
The legislation was codified and funded to the tune of $ 650,000 to continue resettlement programs for remote workers and workers who had been successful before the pandemic. Eligible new employees can receive up to $ 7,500 in relocation expense reimbursement if they become residents of certain areas of Vermont. The Vermont Chamber recognizes the value of attracting new families to live and work in Vermont and has fully supported these programs to improve and expand our workforce statewide.
– Massive healthcare savings have been made for small businesses.
The legislation passed takes advantage of a change in federal health care policy and will result in millions of savings in health care costs for small businesses. Estimates suggest this could lead to savings of up to $ 17 million. The action is the result of the legislature and administration’s rapid reaction to federal change and the defense of the Vermont House, which urged them to act to take advantage of these savings over the next year of the health plan.
– Take-out alcohol will continue.
The current pandemic take-out alcohol provisions will remain in effect until July 2023 for licensees. This extension was a legislative priority identified by the Vermont Chamber and our partner organization, Vermont Independent Restaurants.
– A harmful cloud tax has been avoided.
We’ve helped businesses avoid a harmful cloud tax. The tax would have cost Vermont’s tech industry at least $ 14 million per year by fiscal 2025 and hurt the state’s current tech reputation, while discouraging the hiring of workers to distance. This tax proposal had the potential to negate much of the economic benefits that will be achieved through the state’s investments in broadband infrastructure.
– Millions of tourism marketing dollars have been raised.
We also helped secure an increase of $ 1.4 million for tourism marketing promotion and $ 600,000 for a regional stimulus program within the Department of Tourism and Marketing. Tourism Promotion Funds will be used to promote Vermont travel, recreation, cuisine, arts, culture, agritourism and heritage experiences to attract visitors and boost visitor spending with attractions and local businesses across the state.
As we celebrate these advocacy successes and historic investments in Vermont’s child care, broadband and housing infrastructure, it is unacceptable that lawmakers have not offered substantial immediate relief for businesses in our region. State. When lawmakers return for the next session, there’s still money on the table: $ 514 million of Vermont’s American Rescue Plan Act of 2021 funds have not been allocated. Significant funding is expected to go directly to helping businesses in Vermont, which are suffering severe losses and are still struggling due to the pandemic. The year ahead presents continuing challenges, and it is our shared responsibility to ensure that our state’s business environment recovers and our economic future is bright.
Betsy Bishop is president of the Vermont Chamber of Commerce and lives in East Montpelier. Charles Martin is Director of Government Affairs for the Vermont Chamber of Commerce and lives in Huntington.